Beginning the year with a thorough and organized review of personal finances lays the groundwork for sound fiscal management. Financial specialists Robert Brokamp and Amanda Kish emphasize the importance of establishing a systematic approach to understanding where you stand financially and how to proceed with confidence throughout 2026.
The process starts with the recommendation to select a consistent day and time to focus on personal financial matters. Given the competing demands of daily life, this deliberate scheduling ensures that financial review does not become an indefinite task postponed continually. Brokamp and Kish suggest choosing a period that fits comfortably into one's routine, whether it's a quiet Sunday evening, a Saturday morning, or a lunchtime during the workweek. This commitment to regularity transforms financial management into a habitual activity rather than an occasional chore, fostering discipline and reducing the likelihood of procrastination.
The next step is conducting a comprehensive inventory of all financial elements. This involves cataloging income sources, expenses, bank and investment accounts, retirement funds, debts, and significant assets such as home equity or college savings plans. While this may seem daunting, January is an optimal time to gather year-end statements and collect pertinent financial documents. This complete accounting provides a crucial baseline from which to plan, offering clarity on the full spectrum of one's financial resources and obligations. It also serves a practical purpose beyond planning; maintaining a central record can aid in estate considerations or unforeseen circumstances by ensuring important financial information is accessible to trusted individuals.
Following the inventory, tracking every expenditure over a minimum of 30 days is advised to capture a realistic view of spending habits. This account includes fixed costs like mortgages or subscriptions as well as small, frequent purchases such as daily coffee or occasional dining out. The data acquired can reveal spending patterns that might otherwise go unnoticed, such as accumulation of small expenses or overlooked subscriptions summing to substantive monthly costs. Various tools exist to facilitate this tracking, from handwritten records to sophisticated apps and spreadsheets, allowing individuals to select a method matching their preferences and comfort level.
After collecting this information, calculating net worth emerges as a pivotal measure of financial health. Net worth is defined as the difference between assets and liabilities: summing savings, investments, property equity, and other worthwhile holdings, minus debts such as mortgages, student loans, credit card balances, and personal loans. While the figure itself is informative, its true utility lies in monitoring changes over time, providing insight into financial progress or challenges. Items such as vehicles may be included alongside any associated loans, but personal possessions typically have limited financial impact unless they represent significant value, such as collectible items.
The culmination of these efforts results in a financial baseline summary - a concise, one-page document encapsulating the individual's current financial status. This summary acts as an executive overview, synthesizing the inventory, spending analysis, and net worth calculation into an accessible format. Having this “dashboard” enables easier monitoring, facilitates discussions with family members or financial advisors, and supports informed decision-making as circumstances evolve. Additionally, attaching a self-assessment of one's confidence or comfort with finances at this point can provide a subjective benchmark for future comparison.
Throughout the discussion, the importance of starting somewhere without waiting for perfection is stressed. Adopting incremental progress and accommodating adjustments over time can lead to substantial long-term improvement in financial management. Brokamp and Kish encourage initiating the process with manageable steps, understanding that the competitive attention to these priorities will improve as familiarity and routine develop.
Engagement with peers or a "money buddy" for mutual accountability is also highlighted as a potential motivator. Such partnerships can transform financial oversight from a solitary task into a social, supported experience, enhancing adherence to goals.
Listeners are invited to contribute their own methods and experiences in managing finances, fostering a collaborative environment for financial learning and growth.
In summary, this five-step approach offers a practical framework for individuals aiming to bring clarity, organization, and intentionality to their finances in 2026, setting the foundation for better fiscal fitness and confidence going forward.